Home buyers happy with Rs 630-cr penalty on DLF

People who bought flats at DLF Park Place and The Belaire in Gurgaon have found a new address: seventh heaven. A day after the competition appellate tribunal (COMPAT) upheld the competition council of India’s (CCI) 2011 verdict, penalising real estate major DLF of Rs 630 crore for taking buyers on a ride, thrilled flat owners hope this decision would keep other builders on their toes.

Sanjay Bhasin, president of Belaire owners’ association who had organized and rallied the aggrieved buyers, is thrilled with the verdict. He says that the verdict confirms all the findings of the CCI.

“I believe that this judgment will pave the way for more transparent and balanced buyer builder agreements. Buyers should have the right to inspect and have a say in case changes are made in the original plan,” he says.

Bhasin points out that many a times builder claims to have all the necessary approvals but in reality such promises are just an eyewash. In such cases the entire risk is passed on to the buyers. “The builder should be willing to provide the buyers with all the approvals obtained by them,” he says.

But certain buyers expressed reservations against the judgment. Amit Jain, who had purchased an apartment in Belaire and is the director general of federation of apartment owner’s association (FAOA), a body formed to safeguard the buyer’s interest has mixed feelings about the judgment. “I am not particularly delighted with the judgment. I feel all of it is eyewash,” he says. He is of the opinion that the redressal body did not do justice. “They have 60 days to pay the fine and by that time DLF will file an appeal to the supreme court. In the process they will again defer paying the fine,” he adds. Jain is unhappy that the apartment buyer’s agreement was not considered in the tribunal. “Any amendment to the agreement would have been a benefit to the buyer,” he says.

In 2006, Jain had bought a 4+1 bedroom apartment in Belaire. By the time the construction was only 33% complete, Jain had paid almost 65% of the total price of the apartment. Finally, Jain stopped paying them in 2008 as he felt that DLF was not keeping their side of the promise. DLF cancelled Jain’s and several other buyer’s flats for default of payment. The buyers formed an association and filed a case against DLF in CCI. The buyers had alleged that DLF had changed the original plan, which had delayed possession of their apartment.

CCI had imposed the penalty on DLF for abusing its dominant position in the market as well as imposing unfair conditions on the buyers.
According to reports, COMPAT found DLF abusive in its practices, especially in relation to modifying super area, common area, increasing the height of the building midway through the project and imposing holding charges.

DLF will now have to pay the penalty of Rs 630 crore levied by CCI along with 9% interest. DLF plans to appeal in the supreme court against the verdict.

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